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Welcome to the Finance glossary, we have made this glossary to make you more comfortable in finding and understanding the finance terms. This is brought to you by the loan uk .
Use the A-Z alphabetical list to find definitions of key finance terms.Our aim is to provide the mostcomprehensive glossary of UK financial terms on the internet
Finance Terminology - F
Fee
The amount charged by a lender, broker or other middleman for arranging a mortgage or property purchase. See arrangement fee, booking fee, Conveyancing fee, land registry fees, fees added to loan, IGP, stamp duty and valuation fee.
Fee Indemnity Guarantee Premium (Igp)
Fee indemnity guarantee premium (IGP) an insurance premium which insures the lender against any loss of money, e.g. If you default on your loan or get repossessed. This usually applies only if you borrow more than 70 per cent of the price asked for the property you are buying. Even though you have to pay for the insurance premium, it does not mean that you are covered by the insurance, the lender is.
Fees Added To Loan
The additional costs that are associated with arranging a mortgage and are incorporated into the amount you borrow, they may include indemnity guarantee premiums and arrangement fees. These fees that may be added vary with lender, and therefore care should be taken when the sum of the loan and any costs added to the loan may cause the total advanced to exceed a given loan to value ratio. See fee, arrangement fee, booking fee, conveyancing fee, land registry fees, IGP, stamp duty and valuation fee.
Feuhold
This is the equivalent of a freehold under Scottish law.
Financial Adviser
A person who helps individuals with their financial situation.
First Charge
A legal charge used to secure the main mortgage. A lender with a first legal charge over a property has a first call on any funds available from the sale of the property. See also: second charge.
First Time Buyer
A person that is purchasing a property for the first time. Some lenders offer preferential lending terms to first time buyers. A borrower who has owned a property before but has sold this prior to buying again may be offered first time buyer terms by some lenders but this is dependent on the lender.
Fixed Rate Loans
Offer a fixed rate of interest for a set time frame.
Fixed Rates
A loan where the initial payments, for a certain period of time, are based on a specific interest rate. The rate payable will not change during that period regardless of changes in the lender's standard variable rate.
Fixtures And Fittings
There may be bites in the house that you want included in the sale like carpets door handles light fittings etc.
Flat Over Shop
Residential habitation situated above retail premises. Some lenders will not lend on this type of security because it is seen as having limited appeal to prospective purchasers and therefore have a lower value compared to an otherwise similar property. Any property that is located above commercial property usually takes longer to sell than properties which do not have any commercial element. A flat above a take-away restaurant is more difficult to arrange a loan on than a flat above a book shop.
Flats
A self contained flat that has been converted out of part of a larger property, is known as a converted flat. A flat which has the freehold of the land on which it is built, is known as a freehold flat. A flat designed and built as such; a self contained residential unit contained within a larger structure containing several self contained units or flats all sharing a common entrance, is known as a purpose built flat a studio flat, is a flat comprising a single habitable room, plus bathroom and possibly separate kitchen. Many lenders will not lend on these properties as they are considered more difficult to resell.
Flexi
An abbreviation for flexible. Flexible mortgages are offered by some lenders and allow you to make overpayments in order to repay the mortgage early or save for a special event.
Forbearance
An action a lender may take to delay foreclosure or legal issues with a delinquent borrower.
Foreclosure
The legal process when a borrower defaults on a loan.
Foreign Currency Mortgage
It is now possible to get a mortgage for your property in the UK in a mortgage denominated in a foreign currency. It sometimes gives you the opportunity to borrow money at a lower rate of interest than is possible in the UK.
Forfeiture
When a delinquent borrower surrenders their property rights.
Freehold
Land or property which is owned outright, as opposed to leasehold where the owner has the right to occupy the land or property for a given period of years only. See also: Feuhold.
FSA
Financial Services Authority.
FTB
FTB see first time buyer.
Full Status
A loan where complete checks are made on the borrower's credit history and income.
Full Structural Survey
This is very important as it will tell you if there is any problem or faults with the property you are buying.
Face value
The term used to describe value of a bond when it matures, also known as the 'nominal' or 'par' value.
Fee-based adviser
An independent financial adviser who earns a living by charging a fee for advice rather than earning commission from financial companies for selling their products.
Final dividend
The final dividend is paid after the annual accounts for the year have been published and after the proposed dividend has been agreed by the shareholders at the annual general meeting.
Final salary scheme
The calculation of your pension on retirement is based on a fraction of your pensionable earnings for each year you've been a member of the pension scheme. The most common fraction used is 1/6th and if you had been a member of the scheme from the age of 25 to 65 ,this would give you the maximum pension of 40/60 or 2/3 of your final salary.The fewer years that you are in the scheme means a smaller pension. It is usual for the pension to get regular increases and a provision is usually made for a pension for your spouse if you die first, or if you die before the retirement payment of the one-off payment.
Financial Services Act 1986
The Financial Services Act 1986 has established regulations for firms in the investment service industry, including buying and selling of stocks. It has now been overtaken by the Financial Services and Markets Act 2000 which, amongst other things, has centralised regulatory power in the hands of the Financial Services Authority.
Financial Services Authority (FSA)
The single statutory financial regulator in the UK. In order to do business in the UK most financial service firms must get permission from the FSA.
The FSA regulates banks, building societies, credit unions, insurance and investment firms and independent financial advisers. The FSA is also responsible for Lloyd’s Insurance Market and in 2004 its powers will be extended to cover general insurance advice and mortgage lending. However, the FSA does not cover loans, credit, occupational pension schemes and their administration
Financial Times Stock Exchange 100 Index (FTSE 100)
The FTSE 100 index is a share price index for 100 different shares quoted on the London Stock Exchange, The share are intended to be of a sufficiently broad cross section, so that movements in the index of share prices would be typical of movements in the value of the portfolio of shares of an average investor.
Financial Times Stock Exchange 250 Index (FTSE 250)
The UK stock Market index that measures the performance of the 250 companies below the FTSE 100 companies.
Financial Times Stock Exchange Actuaries All-Share Index (FTSE-A-All-Share)
The 'All Share', measures the performance of over 900 publicly quoted companies and is the broadest based of the UK stock market indices.
Financial Times Stock Exchange SmallCap Index
This is the index for the 'All-Share' market minus the top 350 companies.
Fixed interest security
A fixed interest security is an investment which has a return consisting of income in the form of interest payments and either a redemption value of the security when it eventually matures or the market value of the security if the investor sells it before maturity.
Fixed-rate mortgage
A mortgage where the rate of interest is fixed for a set period of time. The advantage of this type of mortgage is that the investor can budget accurately. Even if interest rates rise or fall and lenders alter their mortgage rates in line, your monthly payments will stay the same. You usually have to pay a premium on the lender's standard variable rate for such certainty, but many borrowers think it's worth it for the peace of mind it brings. They can also prove to be good value if interest rates rise more sharply than expected. Bear in mind that if you switch lenders before the fixed-rate period is up, you'll have to pay a redemption penalty.
Flexible Mortgage
A new type of mortgage that is becoming more popular, especially among the self-employed and other people who may experience uneven cash flow. It allows you to vary your monthly payments without any penalty, and even to take a payment holiday for a while. You can also borrow, or 'draw down', from the loan when you need to. The ability to overpay can save you a lot of interest over the term of the loan. Flexible mortgages often incorporate a current account, too, encouraging the idea that borrowings and savings can be run more efficiently in one pot.
Flotation or floatation
Flotation is the process of making a company's shares available to the general public by obtaining a quotation on the Stock Exchange. Also referred to as "going public" or "obtaining a Stock Exchange listing".
Free-standing Additional Voluntary Contributions (FSAVCs)
See Additional Voluntary Contributions.
Front-end loading
The initial sales charges that you have to pay when you invest in a mutual fund, such as, a unit trust. This charge is mainly for the cost of the adviser.
Future
A form of forward contract to buy or sell a set quantity of shares or commodities in the future at a pre-agreed price.
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